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President Gerald Ford Undergoing Tests at Hospital; Iraqi Expatriates Already Casting Ballots; Congress Probes Disappearance of Cruise Ship Passengers; Four Years Ago Man From Qatar Swept Up In 9/11 Investigation; Reporter At Stanley Tookie Williams' Execution Describes It; Bush Selling Medicare Drug Benefit Program

Aired December 13, 2005 - 17:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: It's 5:00 p.m. here in Washington, and you're in THE SITUATION ROOM, where news and information from around the world arrive at one place at the same time.
Happening now, it's 1:00 a.m. in Baghdad, where no day is exactly ordinary, but today is especially noteworthy, because for 1,000 days the United States and coalition forces have been in Iraq. With critical elections under way, we'll look back and ahead to Iraq's future.

Worries and get well wishes. It's 2:00 p.m. in California, where former President Gerald Ford is undergoing what are being called routine tests at the hospital. What's his condition and when might he be released?

And "Do Not Call" means do not call. Federal officials announce a settlement with a major company for allegedly calling people on the "Do Not Call" list. That will now cost that business literally millions of dollars.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Former President Gerald Ford is in the hospital for treatment for a nagging cold that a spokeswoman says hasn't gone away.

Let's go straight to Rancho Mirage, out in California, for the very latest -- our Dan Simon standing by. Dan?

DAN SIMON, CNN CORRESPONDENT: Hi, Wolf. I just got off the phone with Mr. Ford's press aide, and she wanted to clarify the reason for Mr. Ford's visit here to the hospital. While she did say Mr. Ford has had a cold, she said that's actually not the reason why he was admitted to the hospital.

She says he is undergoing some routine tests, and those were tests that were scheduled in advance. He has this pretty much every year, has a series of routine tests. And she said his health condition is actually pretty good despite the fact he has had this cold. She says he has maintained a very active lifestyle. He swims every day, and still plays golf frequently.

Of course, Mr. Ford has had some health problems in recent years. In 2000, he did suffer a mild stroke during the Republican National Convention. Then a few years later he had a dizzy spell on the golf course which also brought him here to the hospital in Rancho Mirage.

But again, this press aide saying that he's in good health, he's in as good a health as you can be for a 92-year-old, and will probably be released from the hospital as early as tomorrow morning.

Wolf.

BLITZER: Let's hope for the best.

What's it like around the hospital? Are a lot of media getting over there already to cover this story?

SIMON: Yes, a lot of media here. And we've also seen some of the passersby, asking us what's going on with him. Everybody here wishing him well.

Wolf.

BLITZER: We wish him well. Indeed, all of us here at CNN wish the former president of the United States, Gerald Ford, well, as well.

Dan, thank you very much.

Iraq's parliamentary election is still two days away, but Iraqi expatriates are already casting their ballots. Voting stations have been set up in 15 countries, including right here in the United States.

CNN's Aneesh Raman is joining us from Baghdad with more. Aneesh?

ANEESH RAMAN, CNN CORRESPONDENT: Wolf, a five-day national holiday in Iraq has now begun. International borders are closed, travel within the country is barred, curfews have been extended -- the country under virtual martial law ahead of Thursday's election.

Meantime, early voting continues. Yesterday, we saw patients at hospitals, detainees who hadn't been convicted, also soldiers in the Iraqi army. Today, expatriate voting taking place in 15 countries throughout the world, from Washington, D.C., to London, to Amman, to Sydney -- expatriate Iraqis voting on the country's first permanent four-year government. In January, officials say the expatriate turnout was disappointingly low. They're hoping for higher numbers this time around.

Meantime, despite the virtual security clampdown throughout the country, the violence does continue. A Sunni sheik running for political office gunned down today in the city of Ramadi, west of the capital, in an area known to be an insurgent stronghold, the volatile western Al Anbar province.

Also, in the capital, four U.S. soldiers were killed after a roadside bomb detonated while they were on patrol, four members of Task Force Baghdad. It brings to at least 2,150 the number of U.S. troops that have been killed in Iraq, on this, the one thousandth day since the war began. Another landmark to tell you about, Wolf. This is the second anniversary of the capture of Saddam Hussein, pulled from that spider hole at around 8:30 p.m., December 13, 2003. He now faces crimes against humanity. And his first trial set to resume on December 21.

Wolf.

BLITZER: Aneesh Raman in Baghdad. Thank you very much.

And shortly, we're going to be speaking with Senator Joe Biden. He's the ranking Democrat on the Senate Foreign Relations Committee. He's getting ready to head over to Iraq in the next day or so.

Meanwhile, other news we're following, Congress, right here in Washington, looking into cruise ship safety after a series of incidents in which passengers simply disappeared, were never seen again.

Let's bring in CNN's Brian Todd. He's joining us with more. What's going on, Brian?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, a group representing a major cruise line says as many as a dozen passengers have gone missing over the last 18 months. But they also point out that with some 15 million people boarding cruises each year, that's less than one -- one incident, excuse me, for every million passengers.

Still, it is enough to attract the attention of Congress. Two House government reform subcommittees held a hearing today on maritime security.

Now, among those testifying, relatives of George Smith, who vanished from his Caribbean honeymoon cruise about five months ago. His family believes he was the victim of foul play and they are suing the cruise line.

(BEGIN VIDEO CLIP)

BREE SMITH, SISTER OF GEORGE SMITH: Tragedies like my brother's and my family's should not be treated as business as usual. My brother is not a mere insurance liability. He was very loved, as I mentioned. And it's not a matter of dollars and cents. It's a matter of protecting U.S. citizens that are aboard cruise ships.

(END VIDEO CLIP)

TODD: Now, officials from the cruise line in question, Royal Caribbean, tell CNN they do not know what happened to George Smith.

Now, among the suggestions for increased security -- surveillance cameras monitoring all railings in case a passenger falls overboard. The cruise lines say that would cost millions of dollars, and given the rarity of the problem, it just doesn't make economic sense.

Wolf.

BLITZER: Brian, why aren't they required to have those surveillance cameras?

TODD: Well, most of the major cruise lines are not even governed by U.S. law. They register themselves in other countries and are not subject to U.S. labor laws. A spokesman for the cruise line industry says that's because vessels registered in the United States have to be built in the U.S. and staffed entirely by Americans.

BLITZER: Brian Todd reporting for us. Thank you, Brian, very much.

Let's check in with Zain Verjee at the CNN Center in Atlanta for a closer look at some other stories making news. Hi, Zain.

ZAIN VERJEE, CNN ANCHOR: Hi, Wolf. Emergency workers in New Jersey say people may be trapped under the rubble of an apartment complex after a massive explosion blew out the back of the building and set it on fire. At least one person was killed and five others were injured.

One resident describes her reaction.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: It was just a shake. I was in the shower, and just the building was just shaking. And the only thing is, just jump out of the shower and throw some clothes on, just get out of there.

(END VIDEO CLIP)

VERJEE: Initial indications are that a gas leak caused the blast.

The New Orleans Superdome, the scene of so much damage and controversy after Hurricane Katrina, could be a year away from reopening. A consultants' report said the stadium can be repaired and ready to host major football events by November 1 of 2006. Repair costs are estimated at $140 million, most of it covered by state insurance and FEMA money.

She became known as the cell phone bandit for a series of bank robberies around Washington. Now Candice Rose Martinez could spend up to life in prison. She pleaded guilty today to the heists which netted more than $48,000. Her boyfriend, who police say was in a getaway car, on the other end of the calls that Martinez made, and he already pled guilty. Sentencing is set for March.

And it's a death-defying dive. Twenty-one-year-old Shayna Richardson is seen here spinning out of control in a sky diving jump. This is actually what happened on October the 9th in Arkansas. Richardson's main parachute basically failed. And then her backup parachute wouldn't open up completely. And she just smashed face-first into the ground, but she survived. While being treated for her injuries, Shayna Richardson then discovered that she was pregnant. She and the unborn child are said to be fine.

Shayna will join us in THE SITUATION ROOM in our 7:00 p.m. Eastern hour. That's pretty amazing.

Wolf.

BLITZER: It's an amazing story, indeed.

VERJEE: Yes.

BLITZER: It's incredible that she survived this. And we're going to be talking with her, Zain. That's coming up 7:00 p.m. Eastern right here in THE SITUATION ROOM.

Zain, thanks very much.

Jack Cafferty is standing by. I don't know if you saw that video, Jack, but when she's going down like this, and she survives that fall. What an amazing story.

JACK CAFFERTY, CNN ANCHOR: That's the kind of stuff that can happen to you if you go jumping out of airplanes. I mean, I -- I could never do that. I would...

BLITZER: I couldn't do it either.

CAFFERTY: No, absolutely not.

A Saudi prince, Wolf, is donating $40 million to Harvard and Georgetown Universities. Prince Alwaleed bin Talal, a nephew of the king of Saudi Arabia, gave $20 million to each school to expand their Islamic studies programs.

Now, this is the same prince who tried to give New York City $10 million following September 11. But the then mayor of this great city, Rudy Giuliani, in one of the classiest moves by a politician that I can ever remember, told him no thanks.

At the time, you see, the prince wanted the U.S. to "re-examine its policies" in the Middle East. Giuliani told the prince to take his check and deposit it, in a manner of speaking.

Harvard University has a $26 billion endowment. Maybe they can redirect some of those funds instead of taking millions from a country that was home to 15 of the 19 September 11 hijackers. What do you think?

Here's the question: Should American universities be accepting money from Saudi Arabia? You can email us at CaffertyFile@CNN.com. Twenty-six billion dollar endowment, you've got to be pretty hungry.

BLITZER: You know, it's a billion here, a billion there. After all, you're talking real money, as they used to say.

CAFFERTY: Was that Stevenson, Adlai Stevenson?

BLITZER: No, it was somebody else.

CAFFERTY: Who said that? BLITZER: We'll -- we'll find out.

CAFFERTY: Everett Dirksen.

BLITZER: We'll...

CAFFERTY: It was Everett Dirksen.

BLITZER: Everett Dirksen was a great senator.

CAFFERTY: Yes.

BLITZER: Thanks very much, Jack. I'm anxious to hear what our viewers think about your question.

Up ahead, I'll speak live with Senator Joe Biden. He'll join me here in THE SITUATION ROOM. He's standing by on Capitol Hill right now. He's about to head back to Iraq once again. We'll ask him what's going on.

And they mean what they say. "Do Not Call" means do not call. One major American company allegedly didn't heed that warning. Now it has to pay literally millions of dollars.

And he's second in line to the British thrown and he's getting ready to join the Army. That would be Prince William. We'll tell you how he's preparing by preparing to save lives. We'll tell you what's going on.

(COMMERCIAL BREAK)

BLITZER: Welcome back. He's the ranking Democrat on the Senate Foreign Relations Committee. And Senator Joe Biden of Delaware is about to leave for Iraq. Once again, he'll help oversee Thursday's critical parliamentary election.

Senator Biden joining us now here in THE SITUATION ROOM. Senator Biden, what, this is going to be your sixth trip to Iraq? Is that right?

SEN. JOSEPH BIDEN (D-DE), RANKING MEMBER, FOREIGN RELATIONS COMMITTEE: That's correct, Wolf.

BLITZER: All right. Well, first of all, be careful. And we'll talk to you obviously when you get back.

I want you, first of all, to listen to the president -- at least this little clip. He appears to be increasingly more candid with the American people on how things are going. Listen to this.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: This week's elections won't be perfect. And a successful vote is not the end of the process. Iraqis still have more difficult work ahead, and our coalition and the new Iraqi government will face many challenges. (END VIDEO CLIP)

BLITZER: Do you believe this new strategy -- if it is a new strategy -- by the president, is working?

BIDEN: I think it's absolutely necessary. I'm not sure it's working yet.

The president is being much more candid. And -- but what I haven't heard from the president -- and it may be coming, I'm not saying it won't -- is that the president has not come up with what the specifics are that pertain to his new strategy.

Staying the course, the old strategy, doesn't work. The president has implicitly acknowledged that by talking about the mistakes that were made and how we have a lot more to do. I think it's necessary to tell the American people that, to be candid, to get their support.

BLITZER: Your party, the Democratic Party, as you well know, Senator, has been all over the place on dealing with the president's strategy in Iraq. The leader of the Democrats in the House, Nancy Pelosi, has endorsed John Murtha's call for a six-month phased withdrawal, a re-deployment over the horizon. On the other side is Joe Lieberman.

What's going on?

BIDEN: What's going on is that we're responding to the overwhelming lack of confidence that the president -- that the Congress showed in the president's policy. Seventy-nine senators voted for a resolution two weeks ago, Wolf, that said with specificity, Mr. President, you don't have a plan, tell us what your plan and strategy is for winning.

That, then, in turn, has prompted -- that was bipartisan. That, then, in turn, prompted the president for the first time to say he's going to address in more detail the concerns. But that also generated a view -- differing views among Democrats.

And it really comes down to a simple thing, Wolf -- those Democrats who believe that we've squandered all the opportunities and we're in the bottom of the ninth inning, there's not much of a chance to get it right, or the president will not change, are the ones saying, give us a more specific timetable to redeploy and move.

Those of us who think that we're in the bottom of the eighth inning, not the ninth, and think there's still a chance, are saying, Mr. President, you've got a 50-50 shot left, tell us how you're going to change along the lines we're suggesting: getting the political settlement, getting their ministries up and running, changing the way in which we deploy our reconstruction money, how we train our troops, et cetera.

That's the basis of the division.

BLITZER: Well, let me read to you what Joe Lieberman wrote in the "Wall Street Journal" at the end of November: "The Iraqi people are in reach of a watershed transformation from the primitive, killing tyranny of Saddam to modern, self-governing, self-securing nationhood -- unless the great American military that has given them and us this unexpected opportunity is prematurely withdrawn. Progress is visible and practical."

Senator, who is more right, Nancy Pelosi and John Murtha on the left, or Joe Lieberman on the right?

BIDEN: Joe Biden in the middle. You're not getting me into that one.

The fact of the matter is that you have the possibility. Joe is mostly right about the possibility, not the probability.

And look, without a political solution, which is the Iraqi problem, no number of American troops can secure their nation for them. That's why I want to know why the president isn't doing what Secretary Kissinger, Secretary Schultz, Secretary Powell and Joe Biden have been calling for, for over a year. Why isn't he setting up a contact group like we did in Afghanistan and Bosnia, bringing in the international community to put pressure on the Iraqis for a stabilization policy, getting the Kurds to give up a little, getting the Sunni -- Shia to give up, and getting the Sunni to buy in? If you don't do that, if you don't do that, we could add another 100,000 troops and you're not going to solve the problem.

But there's a combination. We should not prematurely withdraw troops as long as there is any evidence there's a possibility that there's a political solution and an economic solution and progress being made.

That hasn't been shown yet. It can be done. The president has to change the course. If he does, we can do this. If he doesn't, we lose.

BLITZER: All right. Do you have confidence in Donald Rumsfeld as the defense secretary?

BIDEN: I have no confidence in Donald Rumsfeld.

BLITZER: So do you, like Senator Kerry, want him to resign?

BIDEN: Not like Senator Kerry. I called for a near (ph) program a year and a half ago for him to resign after Abu Ghraib. But I pointed out that's the president's decision.

I would raise the following rhetorical question: On what significant aspect of our policy, from reconstruction, to the training of Iraqi troops, to whether we'd be greeted with open arms, to the function of ministries, what one single point has Donald Rumsfeld been right on so far?

There have been people in the administration who have been correct. They haven't been listened to.

My plea to the president is, you're now acknowledging, Mr. President, the fundamental mistakes that have been made. Let's start listening to those people in your administration who have been correct about what was likely to happen.

BLITZER: Well, good luck to you on this trip, Senator.

BIDEN: Thank you.

BLITZER: Be careful over there. I know you're going with Senator Lindsey Graham and Senator Saxby Chambliss. We'll talk to you when we get -- when you get back.

BIDEN: Thank you very much, Wolf.

BLITZER: Senator Joe Biden joining us on his way, getting ready to leave for Iraq.

Coming up, they are costly phone calls, indeed. Government officials say they're watching out for companies that violate rules of the "Do Not Call" list. And one major company that allegedly didn't play by the rules is getting ready to pay, literally, millions of dollars. We'll tell you what's going on.

And Iraq's elections already under way, at least partially. Might it be a turning point in that country? And how might the outcome affect the need for U.S. troops there?

All that coming up.

(COMMERCIAL BREAK)

BLITZER: When they say "Do Not Call," they really mean it. One company is finding out the hard way.

Let's head up to New York. Ali Velshi has the "Bottom Line". Ali?

ALI VELSHI, CNN ANCHOR: You know, Wolf, telemarketing has traditionally been thought of as a cheap form of calling. But today it was the center of the largest penalty ever imposed in any consumer protection case in America. It's a civil penalty, but it's against DirecTV.

Now, DirecTV, as you know, is a satellite provider. Many people are watching us on it right now. Fifteen million subscribers around the United States. But DirecTV and some telemarketing agencies that it used to call people to sell equipment and services, sort of attracted the biggest number of complaints to the Federal Trade Commission which enforces this "Do Not Call" list. You know, there are 110 million Americans on the "Do Not Call" list, which means that companies can't call you to telemarket -- can't call you during your dinner time to do that.

Well, apparently, people still make these calls. And as a result, the FTC has, in a settlement with DirecTV, imposed a $5.3 million fine.

DirecTV says it's sorry, it wasn't -- it wasn't their fault, it was the companies. They in fact issued a statement, a sentence from there which is interesting. They said, "The majority of the complaints were the results of calls placed on behalf of a handful of independent retailers." Those are its agencies. "DirecTV has terminated its relationships with those retailers."

The Federal Trade Commission has said that it continues to want to hear from people who get calls that they shouldn't be getting if they're on that list. And I understand that we're going to tell you how to get your name off of that list. I'm going to play close attention, Wolf, because I haven't done that.

BLITZER: All right. Well, you should be doing that.

VELSHI: Yes.

BLITZER: So listen very carefully to this.

And if you want to add your name to the "Do Not Call" list, or perhaps you're on the list but you're still getting those annoying telemarketing phone calls, our Internet reporter, Abbi Tatton, is standing by. She's got more on that. Abbi?

ABBI TATTON, CNN INTERNET CORRESPONDENT: Wolf, there are 110 million people on the registry right now. Over 60 percent of them signed up through this site: donotcall.gov. The way it works, you can go online, add your information. It could be a landline or a cell phone. Put the information on there, and then you are registered for five years.

Also on this site, you can go on and complain if you do get a call, if you are registered. Go in, fill out the questionnaire, tell them who called you, at what time, from what number, if you have all that information, and it will then be logged with the FTC.

Now, the FTC is still encouraging people to sign up on this site, but also to complain if they do get called. This way they can enforce the registry.

Wolf.

BLITZER: Abbi, thank you very much. Helpful news, as usual.

Coming up, 1,000 days in Iraq. But the upcoming election there this week could be a turning point for U.S. forces. We'll show you why.

Plus, a royal rescuer. We'll show you what Britain's Prince William is up to.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back. More now on the war in Iraq. Today marks 1,000 days since U.S. forces began their offensive to topple Saddam Hussein and seize his weapons of mass destruction. Now Saddam Hussein is on trial, the WMDs were never found, and 155,000 American men and women are trying to put down a violent and deadly insurgency right now.

Thursday's election could prove to be a turning point not only for Iraq, but also for the U.S. military presence there.

Our Pentagon correspondent, Barbara Starr, is joining us now live from the Pentagon with more. Barbara?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, Iraqis around the world are now beginning to cast their absentee ballots, and everyone is watching.

(BEGIN VIDEOTAPE)

STARR (voice over): In Virginia, Iraqis cast their overseas ballots in advance of Thursday's elections for the first permanent assembly since the overthrow of Saddam Hussein.

UNIDENTIFIED FEMALE (through translator): Iraq was living under tyranny. And every, you know, free voice or free thought was, you know, killed in its infancy. So, no, not at all. So, this is really wonderful.

STARR: This election could finally begin to change U.S. strategy.

BRIGADIER GENERAL MARK KIMMITT, U.S. CENTRAL COMMAND: As the political process includes more and more of the people of Iraq, there's less reason for the insurgents to fight.

STARR: Some in Congress are already making the case, with a permanent Iraqi government the U.S. must begin to make plans to leave.

REP. ELLEN TAUSCHER (D), CALIFORNIA: It's time for them to start fighting for their chance to self-govern, and we have to get out of that way.

STARR: Defense Secretary Donald Rumsfeld is reviewing several options that could lead to significantly reduced numbers of troops in Iraq by this time next year. There are currently about 155,000 U.S. troops in Iraq.

The longstanding plan calls for at least 20,000 troops to leave soon after the election. But the next step is the most significant -- don't replace 10,000 additional troops as they finish their tour of duty in 2006. Commanders are proposing a plan to make that happen by keeping one Army brigade in Kuwait on standby and a brigade at home in the U.S.

(END VIDEOTAPE)

STARR: Wolf, a senior U.S. military commander tells CNN that part of the best military advice from the field is, indeed, it is time to begin that draw down. It's important, they say, for the Iraqis now not to become too dependent on U.S. troops.

Wolf.

BLITZER: All right, Barbara, thank you very much. Barbara Starr at the Pentagon.

Meanwhile, four years ago this week, a man from Qatar living in this country was swept up in the 9/11 investigation. He's spent every day since then in solitary confinement. The government says he was an agent of al Qaeda. His attorneys say there's just no proof. They just want their client to have his day in court.

(BEGIN VIDEOTAPE)

BLITZER (voice-over): His name is Ali al-Marri. His label, enemy combatant -- one of three such detainees in the U.S. since 9/11, held indefinitely without charges in military custody.

Al-Marri, a 40-year-old from Qatar, has spent the past four years in solitary confinement. He was arrested in December 2001, in his home in Peoria, Illinois, where he lived with his family. He had enrolled in a computer science graduate program at Bradley University.

At first, the government accused al-Marri of credit card fraud and lying to FBI agents. Then, in June 2003, just two weeks before trial, President Bush designated him an enemy combatant, saying he engaged in hostile and warlike acts, working as al Qaeda sleeper agent, planning to hack into bank computer systems and even facilitate a follow-up to 9/11.

The Justice Department said the evidence justified to holding him.

(BEGIN VIDEO CLIP, JUNE 23, 2003)

JOHN ASHCROFT, FORMER ATTORNEY GENERAL: Prevention is the number one objective of this administration when it comes to terrorism. We don't want to let anything happen again.

(END VIDEO CLIP)

BLITZER: The Pentagon told the president, it learned from other detainees that al-Marri trained at a terror camp before 9/11, met Osama bin Laden and volunteered for a martyr mission.

MARK BERMAN, ATTORNEY FOR ALI AL-MARRI: A, it's not true. And, B, it's never been established by any evidence that has been provided, certainly to -- to us or in a court of law.

BLITZER: After waiting 16 months to visit al-Marri at the South Carolina military jail, his attorneys are suing the government to challenge the detention. They want their client to be treated like Jose Padilla, the enemy combatant recently charged with terrorism conspiracy in Florida.

BERMAN: We have made that same argument, that as someone who is being held, should be either charged with a crime or released. BLITZER: But one difference: Al-Marri is not a U.S. citizen. As he remains in legal limbo, his attorneys claim his treatment by the military has been cruel and degrading, at times depriving him of blankets, toilet paper and toothpaste.

JONATHAN HAFETZ, ASSOCIATE COUNSEL, BRENNAN CENTER FOR JUSTICE: Mr. al-Marri has been detained at a Naval brig for two-and-a-half years in a cell that is approximately nine feet by six feet. During that time, he's long been denied books, news, any contact with the outside world, other than his attorneys -- including his wife and five children, who he has neither seen, nor spoken to.

BLITZER: The government has denied in court papers that al-Marri is being mistreated. Both of his lawsuits challenging his detention and his conditions of confinement are pending in South Carolina federal court.

(END VIDEOTAPE)

BLITZER: Still to come here in THE SITUATION ROOM, the day after Stanley Tookie Williams was put to death in California, some are asking if it was justified or simply revenge. We will have an update.

Rich universities and a rich oil nation, should one be taking money from the other? Jack Cafferty going through your email.

Stay with us.

(COMMERCIAL BREAK)

BLITZER: Despite pleas and protests, Stanley Tookie Williams was executed early this morning at California's San Quentin Prison for the murder of four people in 1979. He maintained his innocence until the very end.

Kim Curtis is a reporter for the Associated Press. She was an eyewitness to the execution. She's joining us now from our San Francisco bureau. What was it like? Take us inside as you witnessed this execution.

KIM CURTIS, ASSOCIATED PRESS REPORTER: Well, it started promptly at midnight. We all filed into the death chamber. And, after a couple of minutes, Mr. Williams was brought out in shackles and handcuffs and put on to this converted dentist's chair, which is what they use to -- when they do the lethal injections.

And he laid on his back, and was strapped down. And they had some trouble finding a vein in each arm to insert the chemicals into. And it seemed to take a -- an excruciating amount of time.

BLITZER: When you say an excruciating amount of time, how -- you're a reporter. You were taking notes. How much time did it take?

CURTIS: It took a good 20 minutes, I would say, for them to get the needles inserted properly. And he hadn't taken the -- the Valium that was offered to him before the execution, so he was wide awake and -- and clearly getting agitated at the length of time it was taking. He kept lifting his head, and looking over at his supporters, and kind of shaking his head, in apparent disgust, as they had trouble finding -- finding the veins.

BLITZER: Was he -- could you hear him speaking?

CURTIS: You know, the -- the glass that separates the witnesses from the actual death chamber is so thick, that you could sort of hear things going on, or him saying things, but it was more a matter of watching his lips move and -- and guessing at what he was saying.

At one point, I did hear him say something to the effect of, do -- do they know what they're doing, or do you know what you're doing, and -- to the guy who was trying to find the vein in his arm.

BLITZER: How many guys were in there administering this lethal injection?

CURTIS: You know, I had a horrible, a horrible view. It was very obstructed from the corner of the room. And I was sort of ducking and moving around to try and -- and see what was going on. But I only saw three. And it's a very tiny area, where they actually administer the chemicals. It's a tiny, very cramped area.

BLITZER: And, so, then what happened? In the course of 20 minutes, at some point, you could clearly see he was dying.

CURTIS: Right. They sort of swiveled the chair around, so that his head is facing a different direction. And they all -- they, being the prison officials -- sort of moved out of view. And then everyone just waited.

BLITZER: And then?

CURTIS: He clearly died. The -- right before someone dies by lethal injection, they tend to heave, like, their chests -- they take really deep breaths right before they die. And then their skin turns a very ashen color, and they're clearly not alive anymore.

BLITZER: There have been some complaints over the years that this is cruel and unusual, the way that they administer this death. Did he seem to be in physical pain near the very end?

CURTIS: He didn't to me, but it was hard to tell, again, because it was an obstructed view. He clearly seemed agitated, frustrated, and a little bit disgusted that, you know, even -- they couldn't quite do this efficiently.

BLITZER: Before going in there, did he make a final statement?

CURTIS: He did not.

BLITZER: Did not say anything?

CURTIS: No.

BLITZER: What was your personal feeling, watching all of this?

CURTIS: Well, this -- I have seen executions before, but this was the first that I witnessed where I had actually met the person when they were alive. So, it was a little different experience for me.

BLITZER: Talk about that.

CURTIS: It's kind of hard to, because I felt like I knew him a little bit more as a person, and that maybe isn't where I should be as a reporter. So, I tried very hard to just sort of do my job.

BLITZER: And you did your job, and I'm not going to press you any more on that -- clearly, a difficult assignment for all concerned, including the reporters who had to eye witness this.

Kim Curtis of the Associated Press, thanks for spending a few moments with us.

CURTIS: Sure. You're welcome.

BLITZER: Thank you very much -- difficult assignment, indeed.

Up next, concerned about getting bird flu? We will tell you about something that's even more imminent that should really have you on your guard.

Also, had your fill of those do-nothing royals? Stick around. Prince William training to do something that might change your mind about at least one member of the royal family. We will show you what that is.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Lou Dobbs getting ready for his program right at the top of the hour. Lou is working on it right now. What are you working on, Lou?

LOU DOBBS, CNN ANCHOR: Wolf, coming at 6:00, we will have the very latest on President Ford's medical condition.

Also, communist China's massive cyber-assault on this country, trying to steal our most sensitive military secrets. We will have a special report.

And millions of middle-class Americans have lost their jobs. But, incredibly, one manufacturing group claims there's a labor shortage. We will have that story.

And we will tell you why critics of illegal immigration are now being accused of being un-American for simply expressing their opinions and defending our laws.

All of that and more coming up at 6:00. Please join us. Now back to you, Wolf. BLITZER: All right, 14 minutes away. We will be watching, Lou. Thank you very much.

Beware of bird flu fakes. The Food and Drug Administration says it has issued warnings to nine companies selling products they say help prevent or treat bird flu. All of the products are sold exclusively over the Internet. The FDA says they could harm consumers or interfere with real treatments. The acting head of the agency says he is considering such products a public health hazard.

President Bush today is acknowledging what many older Americans already know all too well: The new prescription drug plan is daunting to sign up and downright confusing.

Let's head over to the White House. Elaine Quijano standing by. Elaine?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Good evening to you, Wolf.

That's right. The president made those comments while on a visit to a Northern Virginia senior citizen, a push, really, on the new Medicare prescription drug plan. Now the president, during his visit, as you noted, listened to some complaints from some seniors about the complexity of the plan.

That program takes effect in a few weeks. And with dozens of choices for seniors, the administration says that helps ensure lower costs and more benefits for seniors.

But since the sign-up for the program began last month, some seniors are sending the message that more choices doesn't necessarily equate to a better system for them, just more confusing. So today, at that retirement community in Springfield, Virginia, President Bush tried to ease those concerns.

(BEGIN VIDEO CLIP)

BUSH: We fully recognize that for some seniors, that this is a daunting task. It's -- you know, when you give people choice and options, it is -- it can be a situation where people say, I don't really -- this is something I may not want to do.

And, so, I want to assure the seniors the following things. One, the Medicare -- the new Medicare plan is voluntary, it's optional. Two, that there are people around who are willing to help explain the program for you and to you.

(END VIDEO CLIP)

QUIJANO: And the Department of Health and Human Services anticipates that up to 30 million people will sign up for the new plan next year. That program, we should tell you, starts on January 1.

Wolf?

BLITZER: All right, Elaine, thank you very much. Elaine Quijano is over at the White House.

The Federal Reserve raised interest rates once again today, the 13th time in a row. What does that mean for small business owners?

Ali Velshi in New York standing by. Ali, you look very dapper.

VELSHI: You know, I'm a big fan of hats, Wolf. And it might just be because of the fact that I'm bald and need the protection. But I wanted to sort of see how, if I decided to get into the hat business, how this Federal Reserve business would affect me.

You know, it does -- we showed earlier that the Federal Reserve rates don't correlate to mortgage rates. So, when the Federal Reserve increases rates, like it has for the last 13 times, it actually hasn't had that much of an effect on mortgage rates.

But it does have an effect on your lending and your borrowing. So, if you're a small business, this might affect you. Now, a lot of small businesses, Wolf, are -- by the way, that's my company, Who Wants to Be a Milliner?

You know what a milliner is, right?

BLITZER: Yes.

VELSHI: They make hats.

BLITZER: Yes.

VELSHI: So, that -- if I were starting a company, saying, who wanted to be a milliner, and I was just new into the business, I wouldn't have any credit. I would have to use my personal credit. And a number of people use their personal credit and even take advances on credit cards, which might cost you as much as 16, 17, even upwards of that, percent a year.

Now, if you have been in business for a little while and you have got some track record, you could -- well, might -- maybe you can borrow money from your house, if you still have some equity in that. And that's going at around 7 percent right now.

Or you can go to a bank and get a loan that is backed by the Small Business Administration, which means they guarantee that, if you don't succeed in your millinery business, you can -- they will -- the bank will get paid back. That's running at about 9.5 percent.

These are all very variable rates. And after a while, if you have done well in your business and you're selling lots and lots of hats, you just go right to Chase or Citibank or wherever and say, look, you know what? You want my business? Give me a better rate, and you could go lower than that.

So, for people who are in businesses, who are -- borrowed money, take a look at your options. The -- the thing you started with to get money for your business may not be the thing you need to have right now. Wolf.

BLITZER: I love the name of your new company.

VELSHI: What Wants to Be a Milliner? I love it.

BLITZER: Yes. Very cool.

VELSHI: I might just go into business.

BLITZER: I think it's a winner.

VELSHI: Can you save my job in case it doesn't work out?

BLITZER: Yes.

VELSHI: Thank you.

BLITZER: All right, thanks very much, Ali Velshi, with the "Bottom Line."

Up next, Jack Cafferty. He is steamed about something once again. Can you imagine? This time, it's about the generosity of a Saudi prince. Are you as upset as he is? Get ready. He's ready to read your email. He'll offer his thoughts.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's head back to Zain Verjee at the CNN Center in Atlanta once again for a closer look at some stories making news around the world. Hi, Zain.

VERJEE: Hey, Wolf. The American Red Cross is getting a new leader. The agency's president and CEO, Marsha Evans, announced her resignation today, effective on the 31st of January. She took over the Red Cross in 2002, amid controversy over the allocation of funds for September 11 victims. Evans is a retired Navy rear admiral and a former president of the Girl Scouts. She says she looks forward to spending more time with her family.

Police clashed with protesters as a World Trade Organization meeting got under way in Hong Kong today. Many of the protesters were farmers from South Korea, Japan, India, Brazil and the Philippines. They say that they won't be able to compete in their markets -- own markets if their countries are opened to imports like of rice. Inside the talks, delegates from poorer countries accused Europe and the U.S. of adopting unfair agriculture policies.

This is what it looked like on Sunday, when it was called one of the biggest blazes in Europe since World War II. But firefighters in Britain now saying that all 20 of the tanks that ignited after a series of explosions at a fuel depot are now extinguished. A few small fires continue to burn, though, still at the facility north of London. And Britain's Prince William is getting in shape ahead of a stint in the army scheduled to begin next month. As part of his training, William took part in a mountain training rescue exercise put on by a Royal Air Force unit. After repelling down a cliff face in front of reporters, the prince downplayed the event as something of a PR stunt. He joked that -- quote -- "We have got real stuff to do now".

Wolf.

BLITZER: Zain, any health damage to all those people in London and -- and the surrounding areas from that huge blaze?

VERJEE: British officials say, no, it doesn't pose any health hazards. A meteorological team flew through the massive smoke cloud and said, basically, you know, what it is, it's all just soot. One of them said it's nothing more nasty than you would get from a regular bonfire. It means that it's not toxic to the world. And it was also tested for asbestos to see if there -- if there was any in -- in the smoke. And -- and that proved negative. So, no, it's not a danger to people.

Wolf.

BLITZER: All right. Zain, thank you very much. What a fire, indeed.

In the culture wars, a new film with a gay theme is getting critical acclaim and generating debate. "Brokeback Mountain," a cowboys-in-love drama, got more Global Globes nominations today than any other film, seven in all. And it has raked in impressive grosses for a film in limited release so far.

But some Christian conservatives and other critics accuse director Ang Lee of sending a message they don't agree with, that being gay is OK.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is breaking new ground. That's exactly what Ang Lee tried to do with this particular picture. He wanted to break ground and try to bring homosexuality to the next level, to normalize it. But I'll tell you what. This is going to be a very hard sell to Middle America.

(END VIDEO CLIP)

BLITZER: A film professor says the controversy may only help the film and the causes of its critics.

Our Mary Snow is going to have much more on this story, on the movie, the controversy over it, in our 7:00 p.m. Eastern hour of THE SITUATION ROOM. That's coming up later tonight.

In the meantime, let's go up to New York once again. Jack Cafferty with the "Cafferty File." Hi, Jack. CAFFERTY: That sounds like a contrived controversy to me. Remember "Midnight Cowboy," 25 or 30 years ago, with Jon Voight and Dustin Hoffman? There was gay sex. And, I mean, this -- I mean, aren't we a little past this, you know, gay is OK? Gay has been around now for a long time. And it seems to me that there aren't too many closet doors that are left closed in this country.

What do you think?

BLITZER: I think you're probably right.

CAFFERTY: So, they're just trying to beat the drum to sell tickets.

BLITZER: I don't know if that's the case, but there has been controversy.

CAFFERTY: Yes. Well, and -- and we will be there to help fan the flames. That's what we do, you know.

(LAUGHTER)

CAFFERTY: A Saudi prince, Wolf, is going to give $40 million to Harvard and Georgetown. Prince Alwaleed bin Talal, a nephew of the king of Saudi Arabia, gave $20 million to each school. He wants them to expand their Islamic studies program.

The question we are asking -- this is the same guy that tried to give $10 million to New York, and Rudy Giuliani, who was the mayor then, said no thank you, Your Princeship -- should American universities be accepting money from Saudi Arabia?

Lillie in Eufaula, Alabama: "Yes. It was an observation of the 9/11 Commission that the intelligence community doesn't know enough about Islamic culture. What better way to learn than to have classes funded in American universities?"

Jane writes: "No, Harvard should not accept the gift from Saudi Arabia. But given that school's arrogance and overrated reputation, it will not care what the rest of the world thinks. Go, Duke."

Norm in Petaluma, California: "What's the big surprise? Most of the rich and powerful give to the rich and powerful to perpetuate the up-and-coming rich and powerful. It's the way things are done in a capitalist society."

Hazel writes from El Paso, Texas: "It's this form of stupidity that simply amazes me. The world would be a much calmer place with idiots like you off the air."

Nick in Miami University of Ohio: "I'm more irritated by Harvard's tuition than by who they take money from. Thanks to his donation, all his kids and his nephews will be accepted into Harvard and Georgetown."

And Dot writes from Saint Simons Island, Georgia: "Why not? Saudi Arabia is certainly getting plenty of money from us, in the form of inflated gasoline prices. And, besides, it might be fun to watch Pat Robertson's head explode when he finds out what is going on."

(LAUGHTER)

BLITZER: Good question, good responses. Jack, see you in one hour right here in...

(CROSSTALK)

BLITZER: ... THE SITUATION ROOM.

CAFFERTY: I will be here.

BLITZER: Jack Cafferty, he's never leaving us.

And, remember, we are in THE SITUATION ROOM every weekday afternoon from 4:00 to 6:00 p.m. Eastern, back 7:00 to 8:00 p.m. Eastern, just an hour from now.

We will have the amazing story, by the way, of a woman who survived a skydiving jump when both of her parachutes failed to open completely. She will be my guest. That's coming up in THE SITUATION ROOM.

Until then, thanks very much for joining us. I'm Wolf Blitzer in Washington.

LOU DOBBS TONIGHT starts right now. Lou is in New York. Lou?

DOBBS: Thank you, Wolf.

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